The bank has claimed that bitcoin will not be able to properly deal with a liquidity crisis in the event of an economic shock.

In the US, when such shocks have occurred, central banks pump additional cash into the economy to address declines in lending and spending in the private sector.

However, such a liquidity infusion would be close to impossible with bitcoin because there is no central institution that controls the network and the number of coins released each year is fixed at a certain rate.

JP Morgan stated: “The ability to provide adequate liquidity is a hallmark of a well-functioning market, but more so during times of crisis.